We have identified recessive XPNPEP3 mutations in families with nephronophthisis-like renal failure (O'Toole, et. al. 2010). Affected individuals have normal kidney size with rare, small cysts and renal histology dominated by interstitial fibrosis and tubular atrophy similar to that seen in nephronophthisis (NPHP), the most common genetic cause of end-stage renal disease in the pediatric population (Hildebrandt, et. al. 2009). We have clearly shown that XPNPEP3 localizes to the mitochondria, rather than the primary cilia/centrosome/basal body complex (O'Toole, et al. 2010) as typical for other NPHP gene products. The yeast ortholog of XPNPEP3, YER078c, localizes to the mitochondria, but not to the cytosol (Naamati, et. al. 2009) and is an aminopeptidase that generally removes a single residue from the amino-terminus of its protein targets (Vogtle, et al. 2009). This post-translational processing stabilizes these targets and increases their half-life by blocking entry into a mitochondrial protein degradation pathway characterized by the N-end rule (Voglte, et. al. 2009, Bachmair, et. al. 1986). We believe that increased mitochondrial protein degradation, as may occur with loss of XPNPEP3 function, can activate TOR, as we found increased TOR activity in YER078c deletion strains of S. cerevisiae which is corrected by the expression of mitochondrially targeted human XPNPEP3. Examining Xpnpep3-/- mice, mTOR activation occurred by 2 months of age followed by the development of tubular damage with pronounced cytoplasmic vacuolization by 4 months of age. These results suggest that the mitochondrial protein XPNPEP3 causes a nephronophthsis-like kidney disease through a novel mitochondrial mechanism of mTOR activation. We believe that mTOR activation may link XPNPEP3 to other NPHP genes, where mTOR activation is known to be important in their pathogenesis, but the mechanisms underlying its activation are poorly understood. Our overall hypothesis is that loss of XPNPEP3 function increases the degradation of mitochondrial proteins to peptide fragments, which are transported into the cytosol where they upregulate TOR activity. It is the activation of mTOR through this mitochondrial pathway that leads to the renal phenotype of interstitial fibrosis, tubular atrophy and cyst formation observed in affected individuals. We will test this hypothesis using yeast and murine genetic models of Xpnpep3 deletion to examine its role in the progression of kidney disease and study the mechanisms leading to mTOR activation and defective protein degradation.